Recently at its Global Roundtable in Paris, UN Environment Finance Initiative (UNEP-FI) and 28 banks from around the world are launching the Principles for Responsible Banking for global public consultation.

Together the banks represent over USD 17 trillion in combined assets, and chief executive officers from 12 of the banks attended the launch.

The Principles will define the banking industry’s role and responsibilities in shaping a sustainable future and by committing to the new framework, banks will be aligning their business with the objectives of the Sustainable Development Goals (SDGs) and the Paris Climate Agreement.

The Principles set the global standard for what it means to be a responsible bank and will ensure that banks create value for both their shareholders and society, and they provide the first global framework that guides the integration of sustainability across all business areas of a bank, from strategic to portfolio to transaction level and by signing the Principles for Responsible Banking when they are launched in September 2019, banks will commit to being publicly accountable for their significant positive and negative social, environmental and economic impacts.

By developing the set of principles, the 28 founding banks set out a clear purpose for the banking industry itself, and also enable investors, policy makers and regulators, clients and civil society to compare banks and hold them accountable for their environmental, social and economic impacts and their contribution to society’s goals.

Signing the Principles will be a serious commitment: banks that continuously fail to meet transparency requirements, set adequate targets and demonstrate progress will face removal from the list of signatories.

Signing the Principles for Responsible Banking is something that all banks that are genuinely committed to sustainability should consider, regardless of their starting point however with differentiated requirements for starter, intermediate and advanced banks on sustainability integration and detailed implementation guidance, they provide an entry point for early stage banks while creating a race to the top among those most advanced.

The Principles are now entering a six-month global public consultation period before they will

be signed by banks from around the world at the United Nations General Assembly in New York in September 2019.

Banks and stakeholders around the world are invited to provide feedback and input to guide their further development, and to signal their support by becoming Endorsers of the Principles for Responsible Banking.

“The global banking industry is stepping up to the sustainability challenge. I’m optimistic we’ll see a realignment of business practice – one that embraces the fact that green and socially responsible business is the best business,” said UN Environment UN assistant secretary-general, Satya Tripathi.

“The Principles for Responsible Banking align the banking industry with the Paris Agreement and with the Sustainable Development Goals, they are frankly long overdue, and they demonstrate a clear commitment from the banking industry to assume its defining role in creating a sustainable future, the only future that is acceptable and profitable for everyone.

“Every bank should become a signatory, and all regulators, investors, policy makers and civil society should support the banking industry as it adopts and implements the Principles for Responsible Banking,” said convener Mission 2020, Christiana Figueres.

“The Principles for Responsible Banking will drive the banking industry’s alignment with the Paris Climate Agreement and the United Nations’ Sustainable Development Goals, we are integrating part of the requirements of these Principles in the RobecoSAM Corporate Sustainability Assessment (CSA), the leading annual survey of companies seeking to benchmark their sustainability performance and competing for membership in the Dow Jones Sustainability Indices (DJSI).

“Banks that want to be best in class in the CSA and members of the DJSI should therefore seek to align with this new global standard,” said RobecoSAM co-chief executive officer, Daniel Wild.

“The PRI have helped drive the integration of environmental, social and governance considerations into investor decision-making.

“It is now time for the banking sector to step up in both assessing the risks they are exposed to, and the impacts of their financing activities in realising the Sustainable Development Goals,” said Principles Responsible Investment (PRI) Association Board director chair, Martin Skancke.

“CIMB has always emphasised value creation which requires a delicate balancing of the long-term interests of our people, planet and profitability and to that end, we are pleased to commit to the UNEP-FI objectives to champion responsible banking and help transform global banking practices.

“We firmly believe that as an industry that plays an instrumental role in economic growth and global trade, together banks could be a powerful force for change, to create a huge positive impact not just economically, but also socially and environmentally,” said CIMB Group chief executive officer Tengku Zafrul Aziz.

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